Investors should stay out of Russia until the fight against corruption and the rule of law improve in that country, William Browder, CEO of Hermitage Capital Management, has been denied entry into Russia since 2006, told CNBC.
"I was the largest investor in Russia on a portfolio basis with $4 billion in the country. And in November 2005 they abruptly took my visa away, claiming that I was a threat to national security," Browder told CNBC.
"Since then, I've pretty much reallocated my assets out of Russia but my experience after that was quite extraordinary in that the police started raiding our offices; they tried to take away our assets; they stole the companies that we had invested through and then stole $230 million of tax money that we had paid in 2006," Browder said.
President Barack Obama spoke at a university in Moscow Tuesday for the second day of his Russian summit, calling for a true global partnership between the two former emissaries.
But President Obama also said freedom, democracy and the rule of law were ideals to be followed and condemned corruption and authoritarianism.
"People everywhere should have the right to do business or get an education without paying a bribe," Obama said, quoted by Reuters. "That is not an American or a Russian idea — that's how people and countries will succeed in the 21st century."
Browder told CNBC the principal problem-makers were Russian bureaucrats like police and tax officials, who are generally paid very little salaries officially, and therefore more open to corruption.